Barriers clear for GME to develop

AN AUSTRALIA-BASED junior with a polymetallic project in Greenland has entered unchartered territory after the country’s government gave the company the go-ahead to include uranium in its commodity mix.

The aptly named Greenland Minerals and Energy Ltd (GME) has been developing its flagship Kvanefjeld rare earth elements (REE)-uranium-zinc play in the nation’s south since August 2007, during which time it has completed prefeasibility due diligence.

At the end of 2008, Greenlanders held a referendum in which they achieved self-determination from Denmark – a move that also saw their country retain its minerals rights.
While the Danish were against mining uranium, Greenland’s parliament indicated it would be a little more tolerant towards the sometimes controversial mineral. It was not until recently, however, that the administration decided to allow – for the first time – projects which included uranium as a potentially economic component to be fully evaluated in the definitive feasibility stage.

As it stands, the broader zero-tolerance policy is being maintained, thus allowing the government to deal with projects on a case-bycase basis as a broader regulatory framework is developed.

SIGNIFICANCE RECOGNISED For the junior – which is hoping to push the 475Mt Kvanefjeld into the definitive due-diligence stage next year – the decision came at just the right time.

GME managing director Rod McIllree welcomes the move, saying it is an indication that the Greenland government is aware of the project’s potential

“The significance of these additions to the standard license terms is that for the first time it allows the inclusion of uranium in mine studies,” he says.

“Previously, this was simply a no fly zone. The company has made an application, the first in the history of Greenland, under the new policy and expects to have approval to operate under the new laws before the end of the year.”

It is on the back of this approval that GME will then commit to a definitive feasibility study (DFS) on Kvanefjeld.

“It is a unique situation, and even though it is an industry-wide policy change, it has largely come about because of our project – the government understands the economic benefits of what such a proposition will be,” Mr McIllree says. “Greater than 90% of Kvanefjeld’s value is now represented by REEs, and a mining operation could see Greenland emerge as a major global supplier of these strategically important metals.

“Uranium has represented a regulatory problem to the project advancing, but the new amendment changes that and uranium will be evaluated as an economic component of the project. The elegant way this process has come about means that it only effectively applies to existing uranium-bearing resources.”

INSIGHT GAINED
The project lies in the northern Ilimaussaq intrusive complex, a layered alkaline intrusive structure in which REEs and uranium are found in the upper lujavrite rocks.

Deposit

Mr McIllree says the most important facet of last year’s drilling programme was gaining further insight into the true resource potential of the broader project area. “Kvanefjeld represents just a small part of a laterally continuous ore system that extends for 6km and can exceed 300m in thickness,” he notes.

“Most of the mineralised horizon is overlain by waste rock, so our initial focus has been to define near surface resources. However, every regional hole that we’ve drilled has intercepted mineralised rock confirming the connectivity at depth.

“It’s fairly clear now that the resource potential is extraordinary. This has had a profound impact on the way the company views what is a truly unique mineral field and only serves to reinforce the strategic importance of the project.”

GEM’s focus this year will largely be on establishing the best possible processing route for the project, and McIllree says the upcoming DFS process will look to optimise the development vision for Kvanefjeld. “The environmental and social and economic aspects are going to be the three key components the government will look at in its final assessment,” he notes. “The study will provide the very clear terms of reference for development of the project, and that study is conducted in close consultation with the authorities in Greenland.”MOVING FORWARD
In terms of metallurgical work, the DFS will look at optimising the process flowsheet that draws on an extraction method developed by the Danish government during its previous examination of Kvanefjeld.

“They spent upwards of US$50 million over 20 years investigating various extraction methods for uranium and quickly came around to the realisation that an alkaline leach process selectively extracts the uranium into a liquid, which can then be separated via a simple liquid/solid separation process,” Mr McIllree explains.

“We have now assimilated that knowledge and engaged all of the firms that worked on the project historically … effectively we have assumed 20-plus years’ worth of detailed research.

“I think people grossly underestimate where we are in terms of process development. There is already a wealth of high-quality science behind this project. “We’re focusing our time and effort on the pre-concentration – that is where the major advances will come.”